Tomorrow's Workers Older, Heavier, and Unable to Retire

Tomorrow's workforce will be older, heavier and unable to retire, according to CIGNA's disability claim operations leader Mark Marsters. Speaking at the recent national Disability Consulting Group (DCG) conference, Marsters outlined the profile of the future workforce and some of the major factors likely to shape integration of health and disability benefits in the next decade.Health care costs, the aging workforce, and the economy are three of the main suspects that will conspire to shock the health and disability industry, according to Marsters, senior vice president at Philadelphia-based CIGNA Disability Management Solutions.

"Health care will continue to drive costs, a problem that will become even more urgent with the aging workforce. The aging workforce will drive greater incidences of disability. The economy may force companies to push their employees even further to boost productivity, which may in turn result in greater stress-related disability," Marsters explained.

"All these trends will make integration of disability and health care more critical, as chronic disease management will become increasingly important along with programs that focus on lowering incidence and coordinating health, stress management and disability benefits."

The biggest growth in health-care spending is coming from baby boomers and their younger siblings, Marsters pointed out. Per capita spending among Americans aged 30-50 rose more than 75% between 1987 and 2000. Boomers are more at risk for chronic disease and are in the throes of a national obesity epidemic, with 61% of Americans overweight. At the same time, spiraling health care costs are being compounded by the high cost of treating chronic disease and mental health treatment related to chronic disabilities such as cardiac, diabetes and lower back pain.

In 2006, baby boomers will begin to turn 60. By 2008, 40% of labor force will be 45 or older, with older workers up to five times more likely to submit claims for short or long-term disability, and absent longer than the younger employee. Older workers will also work longer due to lack of savings for retirement, and increased age limits to qualify for Social Security benefits. A recent American Association of Retired Persons (AARP) study showed that nearly 70% of workers who have not yet retired report that they plan to work into their retirement years or never retire.

"Tomorrow's workforce is saving less for retirement, working into its advanced years, putting in longer hours at work, and picking up more of the tab for health care costs and other benefits," Marsters said. "As an industry, we need to ask ourselves if we have enough in the way of disease management, medical specialists and vocational rehabilitation experts to meet this population's needs." With the possibility that the workforce's "golden years" may be tarnished by chronic disability, according to Marsters, disability coverage that is better integrated with health care may be a leading employee benefit for the graying labor force.

Always the wild card, the economy often drives employers' need for greater workplace productivity at the same time that companies' human resource staffs are shrinking, according to Marsters. "It's anybody's guess how the economy will play out, but make no mistake, it will be a major factor," Marsters explained. Historically, Social Security trends have correlated higher unemployment with higher incidences of disability claims, and higher consumer confidence with lower incidences of disability claims. At the same time, some economists believe that many productivity gains of the 1990s can be attributed to longer work hours, and there is research pointing to the downside of overwork: A study by the Economic Policy Institute found that overtime costs industry as much as $300 billion in stress and fatigue-related problems.

"Downsizing - rightsizing - reorganization - whatever we call it, there is an impact on disability. While we can't control the economy, we can put important resources and programs in place to mitigate its effects," Marsters said. "We need to develop stronger links among programs that improve productivity while integrating medical and disability, and implement programs that focus on disease management, stress prevention, and stress management."